What Every Home-buyer Should Expect
Your long home-buying journey is almost over. You found the home you love, the seller agreed to your offer and now it’s time for closing. Of course, there’s a lot to think about right now, and the last thing you want is something to go wrong. So, make sure you work with our experienced closing escrow officers to help ensure the details come together and everything runs smoothly.
As soon as the seller accepts your offer, the behind-the-scenes work begins. You can expect closing to happen within the next 30 to 90 days, depending on your agreement with your seller.
North Orange County Escrow is where it all comes together. As escrow professionals, we have an important responsibility to our clients. If you are working with a real estate agent, with your permission, he or she will open the escrow with the closing agent as soon as your sales contract is accepted. The closing agent will oversee the closing process and make sure everything happens in the right order and on time, without unnecessary delays or glitches.
- Escrow Instruction Supplement to your Contract
First, the Purchase Agreement and Joint Escrow Instructions is signed by the Seller and Buyer, which the closing agent reviews for completeness and accuracy and prepares the Escrow Supplement to confirm the terms of your agreement. Escrow will also put your deposit into an escrow trust account, where the funds will remain until closing.
- Title Search is Conducted
Once the title order is placed, the title company conducts a search of the public records. This should identify any issues with the title such as liens against the property, utility easements, and so on. If a problem is discovered, most often the title professional will take care of it without you even knowing about it. After the title search is complete, the title company can provide a title insurance policy.
There are two kinds of title insurance coverage: an ALTA Lender’s policy, which covers the lender in the amount of the mortgage loan; and an Owner’s policy, which covers the home buyer for the amount of the purchase price. If you are obtaining a loan, the bank or lender will typically require that the Buyer purchase a Lender’s policy. However, it only protects the lender.
It is always recommended that you obtain an Owner’s policy to protect your investment. The party that pays for the Owner’s policy varies from state to state, here in California, it is typically the Seller that agrees to pay.
- Escrow Agent works behind the Scenes
Your Escrow Agent will request and receive all the demands for payoff of any Sellers liens and HOA documents. We also receive all the paperwork to complete any contingencies agreed to between the Seller and Buyer. We work with the termite companies and receive all reports and confirm any work has been completed. The escrow agent with provide you with your estimate for the final deposit. As a reminder, you will need to provide “good funds” for closing, in the way of a cashier’s check or wire transfer.
- Obtain a Closing Disclosure
Your lender must provide a Closing Disclosure to you at least three business days prior to closing. If you or your lender makes certain significant changes between the time the Closing Disclosure form is given to you and the closing, you must be provided a new form and an additional three-business-day waiting period after receipt of the new form. This applies if the creditor:
- Makes changes to the APR above ⅛ of a percent for most loans (and ¼ of a percent for loans with irregular payments or periods)
- Changes the loan product
- Adds a prepayment penalty to the loan
If the changes are less significant, they can be disclosed on a revised Closing Disclosure form provided to you at or before closing, without delaying the closing.
- The Finish Line: Prepare for Closing
As closing day approaches, the closing agent orders any updated information that may be required. Once the closing agent confirms with the lender and the seller, he or she will set a final date, and time of the closing.
On closing day, all the behind-the-scenes work is complete. While you’ve been busy packing, ordering utilities and coordinating the movers, your closing agent has been managing the closing process so that you can rest assured, knowing all the paperwork is in order.
When you have North Orange County Escrow working on your transaction, you can finally relax and know you’re being taken care of by a neutral, knowledgeable and respectable escrow agent. The closing process should always end with you opening the door to your new home!